Harley-Davidson betting on Trump to break trade barriers

Harley-Davidson CEO Matt Levatich on the state of the economy, the company's growth opportunities in Asia, President Trump's trade policies, the current retail environment and the company's pricing strategy.

Harley-Davidson (NYSE:HOG) has been committed to creating jobs in America, specifically in Wisconsin, where the legendary motorcycle brand was founded in 1903, but CEO Matt Levatich said he sees the biggest opportunity to grow overseas.

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“Trade is very important,” he told the FOX Business Network’s Maria Bartiromo. “We are paying a lot of attention to the trade policies and the trade opportunities that we have, particularly in Asia.”

The company recently announced they would build a new plant in Thailand to keep up with growing demand in Asia, which is the world’s largest motorcycle market according to Levatich. But stifling taxes from India and China have hurt the motorcycle brand’s bottom line.

“Tariffs in the entire tax structure add a significant amount of burden to the product before it gets to retail and that limits our ability to access and reach those customers,” he said.

President Trump has used Harley-Davidson as an example of an American company that has faced 100% tariffs abroad, but in January, Trump pulled out of the Trans Pacific Partnership, which could have helped, in Levatich’s opinion.

“The whole trade environment can’t be taken in isolated cases and so it’s a very complex issue… TPP was in negotiation for almost a decade before it was unfortunately turned down. That would have helped us a lot,” he said. Despite this, Levatich is optimistic on the administration’s efforts to work on American businesses’ behalf.

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“I think a lot of people are participating in the economy, but they are participating in ways that are, I think, easily kind of turned on and turned off. They are watching to see sustained and significant momentum in the economy, job security, income security, those types of things,” he said.

He said the iconic brand plans to attract future generations by recreating the passion for motorcycling.